Decarbonization efforts have resulted in a carbon border tax on the big 5 – cement, steel, fertilizers, petrochemicals, and aluminum. As more and more countries adopt carbon tax the cost of raw materials is going to go up.
REUSE of packaging is about building a closed-loop supply chain. Companies investing in the REUSE ecosystem can realize benefits such as
- Reduced Packaging Costs: Closed-loop system opens opportunities for packaging standardization and operations optimization. Since the focus is on getting packaging returns, the overall cost of packaging can be reduced through a deposit refund scheme. Germany serves as good example in this regard.
- Quality Recycled Material: REUSE ecosystem has ~5% packaging rejection rates due to wear & tear and handling of packaging. This rejected packaging material is an excellent source of post-consumer raw material to produce recycled material. This addresses the current challenge of getting quality recycled material.
- Reduce EPR Cost: A closed-loop supply chain ensures that less new raw material is used to create packaging. This in turn reduces EPR targets and associated costs. CPCB has started taking action against businesses that are involved in shady EPR practices thus in 12 months EPR costs are going to significantly rise.
- Customer Attraction and Loyalty: An increasing number of consumers are seeking environmentally responsible products and companies. Investing in packaging reuse can attract eco-conscious consumers and build brand loyalty.
- Sustainability Leadership: Companies that invest in packaging reuse demonstrate a commitment to sustainable practices, which enhance their brand image and reputation.
- Lower Carbon Footprint: Reusing packaging materials reduces the energy consumption and carbon emissions associated with producing new packaging. REUSE of packaging will contribute towards achieving your carbon emission goals.
With people’s preference towards more sustainable companies and regulators’ willingness to effectively implement polluter pay policy through EPR – the writing on the wall is clear. Those who proactively adopt innovations to create more sustainable companies will continue to find growth opportunities.